India gold sales low, investors sell bars

A model displays gold jewellery at a show in Hyderabad September 8, 2007. India's gold market saw little trading in the physical metal on Monday with profit-taking by investors denting local prices, dealers said. REUTERS/Krishnendu Halder/Files

“There is some scrap sale and some sale of old bars that was bought by the market for investment purpose,” said Naresh Devatha of Micro International, a large trader in Bangalore.

Dealers said local prices were discounted over the rates being quoted by primary sellers -- the banks and trading houses that import gold -- owing to low demand and sales by investors.

“There is an indication that gold is lower by 100-115 rupees per 10 grams (over the bank rates),” said Satish Bansal of M.D. Overseas Ltd., a large gold importer based in New Delhi.

Dealers in bullion banks said there was hardly any sales with their clients wishing for drops to around $800 an ounce.

Gold prices were higher on the back of overseas markets where a surge in speculative buying on expectations of a U.S. rate cut pushed gold towards its early November 28-year high of $845.40 an ounce.

India’s demand has been low since the price broke above the psychological 10,000 rupees mark, but dealers hope weddings in the next few months would make traders keep buying at dips.